Nigel Wimpenny, managing director of South Lakeland Parks, which operates nine holiday parks in the Lake District and Lancashire, welcomed the Government's announcement on static caravans.

He said: "As soon as this tax was proposed, we knew that the figures just didn't add up. The Treasury's own somewhat reserved estimates of a 30% drop in the sales of caravans would have impacted upon thousands of direct and indirect jobs across the country, particularly in rural areas like the Lake District."

"Although we are pleased that the 20% rate of tax has been kicked into touch, the Government's revised plans to introduce a new 5% rate of tax to the purchase of static caravans and lodges from next year will still have a negative impact on the industry - albeit not to the level that was originally feared," he added.